Cameron: It was right to raise taxes when Britain last faced a debt crisis

Speaking to the Tory Spring Forum in Cheltenham the Tory leader said tax increases were the right thing to do when Britain last faced a (less serious) debt crisis in the early 1990s. Echoing George Osborne's remarks to Sky News earlier he promised that, in due course, he would tell voters about Tory spending plans BEFORE the election. Tory strategists believe that voters are not yet clamouring for details from the Tories and that they don't expect them until nearer the election time when the scale of the budgetary challenge facing the incoming government is clearer. In the meantime the Tories intend to show they are working hard on plans to deliver better value for taxpayers' money and that ministers will be promoted (or sacked) in proportion to their success at cutting their budgets and using decentralisation and technology to deliver better services. "More for less," is David Cameron's promise.

Highlights from David Cameron's Spring Forum address:

We've created a balanced and true Conservatism: "Yes we’re the party of strong borders, law and order and low taxes – and we always will be. But today we’re also the party of the NHS, the environment and of social justice too."

Britain needs massive change: "Unless we deal with this debt crisis, we risk becoming once again the sick man of Europe. Our recovery will be held back, and our children will be weighed down, by a millstone of debt. So this is no time for business as usual. This is no time for more of the same. There is only one way out of this mess, and that is through massive change. I’m frustrated it’s not happening. I’m impatient to get on with it. And today I want to explain what the change needs to be."

We will tell people how we'll balance the books BEFORE the General Election: "In the weeks and months ahead, the Shadow Cabinet will redouble its efforts to identify wasteful and unnecessary public spending. Make no mistake: I am very clear about how much more work there is still to be done in order to identify significant future savings. We will carry out this work. We will do so responsibly. And in time, we will set out the hard choices that lie ahead."

Ministers will be promoted if they deliver more on smaller budgets: "With a Conservative government, if ministers want to impress the boss, they’ll have to make their budgets smaller, not bigger. On my watch it will be simple: if you do more for less you get promoted if you do less for more, you get sacked. If we’d had this approach over the last twelve years, I don’t suppose there’d be a single Labour Minister left. But this culture of thrift must apply to the civil service too. So we’ll impose a new fiduciary responsibility on senior civil servants – a contractual obligation to save the taxpayer money. And every government department needs a proper finance director. Some of them today aren’t proper accountants – flint-faced or not. With such huge sums of public money at stake a Conservative government will make sure we have the professional financial controls the taxpayer has a right to expect."

It was right to raise taxes when Britain last faced a debt crisis: "For me, this is very personal. Fifteen years ago, I was in the Treasury as we had to deal with public finances that had got out of control; debt that had got too high. We had to put up taxes, and I hated it. But it was the right thing to do and that lesson has stayed with me. That’s why I’m a fiscal conservative."

Closing flourish: "Labour’s leaders say only they stand for fairness. Fairness? These Labour ministers, saddling future generations with debt? These Labour ministers, making our children pay the price of their incompetence? Their “fairness” is utterly phoney. So let’s turn our anger into passion ad our passion into action to give Britain the leadership she needs. Yes if we win the election, we may not see the full fruits of our labours in the lifetime of our government. But if we stick together and tackle this crisis our children and grandchildren will thank us for what we did for them and for our country."

Comments

"Yes if we win the election, we may not see the full fruits of our labours in the lifetime of our government. "
If this indicates an end to short-term political jiggery-pokery and spinning a la Gordon's bunker, much to be welcomed. And an argument for a few bites at the cherry.

It was a very solid speech in the end and certainly will strike the tone that we are looking to strike with the electorate, providing the liberal media cover it at all of course!

I was disappointed there wasn't an announcement to repeal the 50% tax rise but let us see what happens if the Conservatives win the next election. Cameron is an intelligent politician at the end of the day and publically pragmatic much in the vain of Mrs Thatcher.

I expect that the tax will be short lived whatever happens.

Congratulations on a strong performance Mr Cameron, let us hope it propells us a strong working majority in 2010 and a Labour Fourth Place finish this June.

Excellent. One of Cameron's best speeches. It contained the brutal honesty we've been calling for, along with some of the unpopular choices suggested on here, such as rolling back tax credits for the better off.

I think the public will respond to this accordingly. Labour's dishonesty budget has been well and truly rumbled and Cameron has bought himself valuable political capital by telling the British people some uncomfortable truths about Labour's years of plenty.

If it takes a year for Cameron to tell us how he is going to balance the books,how long will it take to actually balance the books?
Mr Cameron,time is short and we need the answers now not in a year's time.
To say ,as your comment,that the scale of the budgetary challenge will not be known until near the election is simply not true.We do not and will not know exact numbers but we know the approximate scale

Conspiracy theorists might start to wonder just how much malign control Brown and Mandelson have over world events...

Conservative 2008 Party Conference - overshadowed in the media by the banking crisis.

Conservative 2009 Spring Forum - potentially overshadowed by the outbreak in Mexico of Swine Flu, now spreading around the world at an alarming rate...?

I jest of course, but a part of me wouldn't put it past Brown to be praying for an outbreak here that requires 'firm action', and a steely eyed Prime Minister 'doing what it takes' in the face of a crisis he has no real control over.

Labour's 'fairness' is indeed phoney. Particularly the way the Labour government claims to be the champion of the poor. This myth must be exposed as Labour's greatest lie.

The gap between rich and poor has become an insurmountable chasm under Labour. The poor can't even get access to a dentist and their quality of life shrinks with each year of Labour government.

Still, one gets the impression that Labour likes to keep the poor like household pets, to stoke them, to patronize them and occasionaly throw them a morsel like an extra few pence on top of their benefit.

In the worst economic crisis since the Great Depression, I think its not unreasonable for the Opposition to warn off from giving instant answers they will almost certainly regret later on. Giving early off the cuff answers simply provides the Government with enough rope to hang the opposition with.

Soon it will be less than a year from an election. I stil fear Labour's ability to rig the vote but if they do not, we could see one of the happiest moments of my life materialise. The defeat and rout of Socialism and Labour.

And it is right now. There simply is no way around the fact that Brown has borrowed us into very deep trouble. It would be better to raise tax's quite sharply in the first few years of a new administration, and then with good management we can start to bring them down before the following general election. Of course there will be those who throw a fit at such a suggestion and there will be wailing and gnashing of teeth, but we have to be realistic. The alternative is for Britain to be burdened by its debt for a very long time indeed. Any housewife will tell you that Borrowing is a last resort, but when you do borrow you pay it back as quickly as possible, to avoid paying to much intrest. I predict that there will be tax rises across the board, not only for the rich but also the middle class and sadly even the poorest will have to tighten their belts. The sooner we put our books in order the sooner we will be able to get back to a tax cutting agenda.

He certainly signalled a massive shift in the role of the state, from paymaster and provider to funder and facilitator. I think that tax rises are going to happen one way or another so get the big ones done with first. Then concentrate on the paradigm shift in the way the state operates.

I think that he is right to give details but not specifics at this stage. The situation is too changeable and anything he said would be open to thievery by Labour. Then the would gleefully eviscerate us one specific at a time.

Higher taxes will *not* speed Britain's recovery, they will be a huge hindrance and causes real long-term damage to the UK economy.

Lord Jones is saying it. Richard Branson is saying it.

And what is scary, the two policies they highlight as causes the most damage, the non-dom levy and the 50p tax rate, one was proposed by not Labour but Osborne himself, and the second Osborne has given no concrete plans to repeal.

Labour have created the frame of technological advances enabling 'efficiency savings' with no front-line services impact, so why not show the Tories have identified more of these savings? How can Labour argue?

So larger 'efficiency savings' to plug the black hole, and tax *cuts* (smaller than the efficiency savings to ensure the debt it reduced straight away) to stimulate the economy by putting money in current taxpayers hands *and* encouraging new investment.

To even suggest higher taxes implies a timid intention on spending restrain.

I'd like to know more, mainly about he squares this:we’re...the party of the NHS, the environment and of social justice too."
with this:Britain needs massive change... There is only one way out of this mess, and that is through massive change.
I mean, it's the massive involvement of the State in such things as medicine, welfarism, environmental pseudo-concern and arbitrary cod-egalitarian ideas about "social justice" that have led not only to national near-bankruptcy but also to the dangerous growth of the State at the expense of political liberty and individual freedom.
it's nice to know we're going to be told how he will balance the books, before the GE: we've been waiting rather a long time for hard facts.

We now need a debate about a whole range of really big issues. The bloated public sector will not be cut back by fiddling with the odd quango. Top of my agenda would be a fundamental review of the welfare state - why pay benefits to all when some may not need them? Second would be public sector employment rights - retirement at 65 instead of 60 and stopping the gold plated defined benefit pension scheme that will eventually bankrupt us all. Billions are involved with these issues.

Richard Branson is saying it. If Branson was to stop trading even for a moment he would be done. Branson is exactly the type of entrepreneur who Labour admire. I don't I think he is an irresponsible butterfly. So please do not hold up Branson as a model he is a socialist in socialist clothing, running a business model that is based on running away from long term responsibility. He has sold everything from Hippy rebellion to Vodka and then got himself into the very worst of the oil-boom industries. Branson doesn't have Britains best intrest at heart.
He will also be excatly the soft to back Europe to the hilt. Branson means that it is not in his best intrest to pay even a modest amount more tax. Hasn't anyone shown Branson a Pound coin recently has he forgotten who's money it is? 50p in 100p is not a very big burden now is it? Would he prefer that we go after the tax havens instead? A lot of people are going to take a very big hit indeed those pension that the public servants have, are not safe. We may as well make retirement for most people a very distant prospect. Has the penny not dropped yet the cupboard is not only bare it is stuffed with promissory notes. The alternative is to ring fence the loans and inflate our way out...not pretty and likely to end in total economic collapse. We will be paying more tax end of as far as I'm conquered the manly thing to do is bite the bullet.

Great speech a great balance of honesty, and vision showing the direction of the party which i truly welcome. Regarding Swine flu as one poster commented on here. I am really worried about it i think Gordon Brown must save the world yet again. He must go around and promise "coordinated global action".

I would disagree. When you're spending beyond your means the #1 response should be to cut that spending. You should never spend money you do not have.

Cameron's nostrums to treat our current economic malaise should be to work on the basis that the income from the tax-take is frozen. Static. Fixed. For the next five years *at least*.

If this results in a revenue-gap, well - step one is to terminate foreign-aid to despots and the whole DfID malarkey. Then we de-hire the 'smoking cessation coordinators' and 'real-nappy outreach workers' along with suspending all our payments to the Common Agricultural Policy and anything else European-union.

Charity begins at home, remember. You can't spend what you don't earn.

One of the highlights of this fine speech was David Cameron's determination to achieve greater transparency. His pledge to publish all public sector salaries above £150k per annum online is something which I believe will resonate with the general public.

The reason for the change in tone from David Cameron probably has something to do with him realising he is only about a year away from being in number ten (although lets not take that for granted just yet). Dave must know he's going to have to make some tough choices real soon and I think he's just trying to prepare the electorate for it.

PS. As for higher taxes vs spending cuts. We need both. The bottom line is the UK is in loads of debt and it has to be paid back. That's not nice to say, but it is the reality of the situation we are in.

Paying it back will probably take a generation... Let's remember that before ever thinking about voting Labour ever again...

"It's a major problem facing all parties. If we only pay benefits to those who need it (e.g. pension) what is the incentive for the low-paid to save?"

Compulsion, its not a pretty word and it will be hard to swallow but we cannot continue the way we currently are. In return for saving for a pension the slightly better off and the well to do, should receive a modest rebate on NI. What is truly galling is that before Nu-Labour we were in a far stronger position. I am afraid that this next administration is going to have to make some very unpopular decisions.

Clearly massive cuts in public spending are necessary because of the mess we're in. What I'd like to see is a committment to keep public spending and taxes low even when the current crisis is over. Admittedly that looks like a very long term aspiration.

Please no more "sharing the proceeds of growth" - that's a very slipperly slope, as we are learning painfully now.

I do not believe we can avoid putting up Taxes, On taking power we will find that the Countries Debt is far greater than Brown would admit. We will be faced with three possibilities to hold the line while before cuts start to bite:
1 : Let the pound drop against other currencies.
2 : Print more money
3 : Raise Taxes.
I think that possibilities 1 and 2 are unacceptable. So we will need to introduce a budget to increase taxes as a short term measure (the “Brown Tax”). I personally would prefer a luxury rate of VAT rather a rise in income tax.. With careful planning the first cuts (I.e stop work on ID cards) should start to bite within three months but it will take time identify those area were the big cuts will be needed. After three to four years we should start to see a reduction in income tax as the debt is paid off.

stupid idea, we are already one of the most taxed nations on earth and he wants to increase it this will stifle competition kill entrepreneurs and make businesses go elsewhere as if the 50 % top rate of tax wasn't enough

what we need is to cut spending drastically - the NHS has had way too much spent on it in the las 11 years and not with a proportionate improvement . Instead we need to abandon this stalinist like state structure and go to a social insurance style system like switzerland this would save lots of money as it would cut healthcare down to size but for a better service

we have 9 regional assemblies at the moment , 8 of which aren't elected get rid of them -

we have 650 parliamentarians , this is far too many at the end of the day for a country the size of britain and costs us way too much . Cut the number to 450

Abolish the farce which is the idea of an NHS computer database, abdandon trident which we don't need , abandon id cards. Get rid of the many quangos we don't need

if we cut this spending we will not need to raise taxes , bite the bullet cameron

I very strongly am afraid of epidemic.
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